Quantitative Aptitude • Simple & Compound InterestMedium
What will ₹375 amount to in 2 years at 20% per year compound interest, compounded annually?
A. ₹165
B. ₹525
C. ₹450
D. ₹540✓ Correct Answer
💡 Solution & Explanation
Amount = principal × (1 + rate/100)². After year 1: ₹375 × 120/100 = ₹450. After year 2: ₹450 × 120/100 = ₹540. With simple interest it would be only ₹525; compounding also earns interest on the first year's interest.
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